SD Revenue Recognition Related Question

Hello Gurus,
We are using SD revenue recognition. Business wants to switch unbilled receivables account. I want to understand the impact of doing it on existing sales documents and how SAP will affect existing entries in RR tables.
Any help would be helpful.
Thanks,
Pankaj Gupta

Hi,
What type of RR you are using. Changing unbilled account is generally not suggested for Time based RR.

Similar Messages

Service-related revenue recognition

Hi Experts,
When post VF44 for a contract with Service-related revenue recognition (revenue recognition category B) get the message below. No RR FI document posted too.
<<Document for SD reference number u2018delivery orderu2019 does not exist
Message no. JHE019
DiagnosisDocument for SD reference number &1 does not exist. If accounting documents for revenue recognition have been created at collective processing level, you cannot navigate in the original document.>>
Any advise.
Cheers.

hi,
please check in scribd these is a link related to RR.
or
please check in forums on the same.
regards,
balaia

Accrual run and revenue recog( time related revenue recognition)

Hi All,
Please let me know what are the configuration steps required to perform accrual run and revenue recog( time related revenue recognition) in R/3 when we do billing in CRM , for service contracts with start date and end date and billing plan - quarterly in advance
Required scenario:
Contract creation in Crm
Billing in CRM
Accrual Run in R/3
Revenue Recognition in R/3
can we do with the help of result analysis key and internal order .
Your valuable reply awaited
thanks
SK
Moderator: Thread locked due to cross posting.

Hi
Please refer the below mentioned link
http://fuller.mit.edu/sb_support/media_lab/deferred_revenue_recog.htm
http://sap.ittoolbox.com/groups/technical-functional/sap-log-sd/intercompany-revenue-recognition-process-3042637
It may help you
Regards
Praveen P C
Edited by: Praveen Chirakkel on May 18, 2011 9:13 AM

SD Time/Sevice related Revenue Recognition

Hi
Has anyone switched to a time/service related revenue recognition method from the standrd billing method? we are looking at switching and I wanted to know of anyones experience and problems you came across during your change, did you create new item categories or just update the existing categories(this is what we are thinking of doing). How did you handle open Sales orders which are using the standard method etc...
thanks
Joe

Dear Joe
Please go through the OSS NOte
779365 - Best Practice document for revenue recognition
Or Seach Google below
1- Search Revenue Recognition Processing (474)
2- SAP R/3 SD REVENUE RECOGNITION -
BEST PRACTICE
Knowledge Document
Version 1.4
You will find it on Google easily
Thanks and Regards
Asad

Help on Revenue Recognition

Hello Friends,
I’m hoping someone can help me in answering the following questions.
Example of a bundle solution that includes product license, education and consulting services. One parent SKU that auto-explodes into three child SKUs – product, education, consulting.
1. Booked revenue is allocated to one PL (based on parent SKU). Do we need to create a new unique PL? Can this be re-allocated to 3 PLs? How is this done?
Example of a Education blended offering which includes different delivery methods – ILT, video-ILT, eLibrary (WBT modules) and certification. One parent SKU that auto-explodes into the child SKUs. Each child SKU will trigger the appropriate behavior similar to the standalone offering. Customer will need to get a voucher for each component to redeem against.
2. Can we still track revenue for each delivery method and certification by the child SKU? If not, why not and how can this be done?
3. Will revenue recognition be handled separately for each component (child SKU) or as part of the bundle, by the parent SKU. For example, we send the customer a voucher for each component, sometime revenue can be recognized when the voucher is sent to the customer (eg. WBT can recognize revenue immediately once the voucher is sent to the customer).
4. Issues/requirements we need to be aware when setting this up?
Thanks for all the help...
Vijay

Hi
But the error is related to controlling . Just go to OKKP and check wheather you have checked in the controlling area properly or not
make the following down payment configurations
item category group - 0005
item category - TAO
for this TAO item category a billing plan 01 (milestone billing plan -01) will be assigned and its billing relevance should be I which is order related billing .
billing doc type - FAZ
cancellation billing doc type - FAS
maintain a condition type AZWR which is down payment settlement , it has requirement as 2 and calc type as 48 acct key as ERL
Now when you enter a material in line item 10 and go to item data , you can see the billing plan tab.
now go to billing plan tab and enter the start date and enter the dates on which billing has to be done and then in billing request enter 0009 which is for down payment.once u press enter automatically it all the dates get blocked and billing request by default you get as 1 , that you change it to 4 or 5 . 4 is for down payment at value basis and 5 is for down payment at percentage basis. and beside that there will be a billing type .assign billing doc type as FAZ. to all dates
check the copying requirements are there at VTFA as 20 and for item category TAO copying requirements 23 is maintained or not
now do the cycle OR - LF - FAZ (billing doc type)
Regards
Srinath

Revenue Recognition based on percentage of completion of work.

Hello Experts,
My customer has the following scenario for revenue recognition.
My customer sell services. So I create a project and attach to the sales contract which has mile stones for billing.
After completion of milestones, billing is triggered automatically. No issues on this part.
When comes to revenue recogntion, they recognise the revenue after the work completion and nothing related to billing.
They take forecasted manhours(planned hours) for the services and take the time sheet hours (actual hours) and calculate the percentage of completion. They apply the percentage in revenue and based on the percentage of completion, they do revenue recognition.
My questions..
1. Is this a standard functionality in SAP? My customer is in sap 4.7
2. If this is not a standard functionality, then how to tackle this issue. Is there any work around?
Any type of help would be grateful.
Regards
Srinivasan Desingh

Hello,
The Best Practices document alongwith the scenarios supported in standard SAP is available as an attachment in the Note 1172799.
Regards,
Raghavendra YN

HELP: AR Open Invoices Conversion with Revenue Recognition (Daily Revenue)

Hi,
I need some help on Conversion of AR Open Invoices with Accounting Rules in R12, Here the client wanted to use Daily Revenue Schedule rule,
I am developing Functional Specification Document (CV.040); Need to understand the Assumptions, Approach and Which data needs to be extracted from Legacy System.
Appreciate your reply at the earliest
Thanks
Ravi

Anil,
Thanks for your response, Here are the answers to your questions.
1) The invoices that you want to convert - Do they already have revenue recognition on them?
Ans: Yes they have Revenue Recognition On Them.
2) Are you bringing only Open Invoices? What about Invoices that are closed (paid), but still have unrecognized revenue on them? DO you want to bring them
over? If no, how will be mage the recognition of those invoices?
Ans: We want to bring only Open Invoices. i.e the following scenarios want in Data Extraction
a) Invoice is Fully Paid (REC is Zero) and Unearned is Full Invoice Amount, Revenue is 0
b) Invoice is Partially Paid (REC is Partial) and Unearned is Partial, Revenue is partial
c) Invoice is fully Paid (Rec is Zero) and Unearned is Partial and Revenue is Partial
d) We do not want to bring the invoices with Fully Paid and Fully Recognized, Unearned is Zero
3) What about partially paid invoices? How do you want to bring them in?
Ans: See above scenarios.
4) Do you want to bring in all Invoice details,or just bring in a summary line with the outstanding amount?
we assume only Summary, but if the Invoices with Several Lines and Different Accounting Rules, We may have to bring them too
Appreciate your response; Suggest some possibilties?
Thanks
Ravi

Price Change for Revenue Recognition

Dear experts,
I am using Revenue Recognition of type B with Revenue Recognition before invoicing.
I have an issue/question about the way price changes are treated in the functionality.
The below example is used to describe the issue for your understanding:
1.Pricing master data: $100/EA
2.Price of item in sales order: $100/EA
3.Qty in sales order: 10 EA
4.Delivery & Goods issue: 10 EA
5.Revenue Recognised (VF44) for: $1000
Accounting Entry:
DR Unbilled Accounts Receivable $1000
CR Revenue $1000
6.Change in pricing master data: $120/EA
7.Partial Invoice for: 2 EA @ $120/EA
Accounting Entry:
DR Customer $240
CR Unbilled Accounts Receivable $240
8.Partial Invoice for balance qty: 8 EA @ $120/EA
Accounting Entry:
DR Customer $960
CR Unbilled Accounts Receivable $760
CR Deferred revenue $200
9.Subsequent Revenue Recognition (VF44)
Accounting Entry:
DR Deferred revenue $200
CR Revenue $200
As you can see in the example above, the amount of the price difference is not credited to sales in step 7. From what I have seen so far the additional amount due to price difference gets credited to sales only after the total invoice value for the item exceeds the revenue recognized.
Is there any option to set the system so that the price difference is taken into account for revenue recognition during each invoicing (even
when the invoicing is partial) ?
Thanks in advance for your help.

The price difference will not go to Sales in Step 7. The reason being Revenue Recognition works on the item rather than the amount. Since you have run F-44, the system finds the same in Unbilled Receivables and posts to that account.
For updating the price changes, you have to run VF46 to cancel the original RR entries. In this case, it will just clear of the RR lines if realization has not happened and post a reversal if realization has happened. This txn will also create a new RR line for VF44 which you can process.
Refer Note 820417 Implementation guide for RR. Download the attachments and look into Part2 doc page 13. This explains how to deal with price changes in sales document.
Hope this helps.
Ravi.

Cost of Goods & Revenue Recognition

Dear All,
I have a typical requirement related with the cost of goods sold (COGS) G/L account & the revenue recognition.
Under SAP best practice, the COGS account is updated together with the Inventory account when post goods issue (PGI) is done.
there are 2 scenarios here -
1. Normal Sales - delivery related invoicing. Here the invoice is created immediately after the delivery. So here the revenue & cost recognition matches.
2. Project sales - PS not being used. Just created milestones using milestone billing. Here the invoice is order related with billing plan. So the milestones are
a. 50% after order confirmation.
b. 40% after delivery.
c. 10% after installation & commissioning.
Here the revenue will be generated at three stages & the COGS will be updated after delivery (PGI).
Is there any way we can update the COGS at the time of invoice in standard SAP.....?
With best regards,
Niyaz.

Hi friend,
Pls use T-code OMJJ and OBYC to setting as stop update acct in PGI! I only know the location to impact about it! With update acct in Invoice, I need to verify again for! I will update when I cover it. Hope this help
Best regards,

How Revenue Recognition value calculate in VF45 for an item

Hello Experts,
I want to know how system calculates Revenue Recognition for any item in VF45. I know the configuration part of Revenue Recognition but want to know the calculation part, how calculation going to find out the vale of the Revenue recognition.
Item net price is 3139255.45 and system calculate Revenue recognition for this item is 3139020.94.
I want to know how calculation going for Revenue recognition.
Can any body help me out ? any link /document related to Revenue Recognition Calculation (not configuration) please share with me.
Thanks,

Hello Prasanth,
For example :- Maintaining an annual Price ZPRC - 1200 and Billing plan is Annual
So, while recognising SAP takes 1200 / 365(Number of days) = 3.287 per day
For jan - 31 days - 31*3.287 =101.91
For feb - 28 days - 28*3.287 = 92.05
Thank you for your time.

Revenue recognition in Item category

Dear All
Can you advise what exactly is revenue recognition in item category?.
I need to enter A in the field, but the field is greyed.
Thanks
Deepu Pillai

Dear Deepu,
The Concept of "Revenue Recognition" in Item Category is -
The material, with specified Item Category, is defined for income-accrual or not.
Now, Income-accrual means, say, in a month, you have "n" no. of orders to deliver, but might possible that Invoice and Payment, may get done or may not be.
So, to realise such income for a particular period, we run revenue-recognition (VF44). In VKOA, we maintain "Provisional Account" for such income.
Once invoiced, Accrued income G/L gets debited and Customer G/L gets credited.
[Revenue Recognition|http://help.sap.com/erp2005_ehp_03/helpdata/EN/4d/fcd139f6e4cf2ce10000000a114084/frameset.htm]
As you asked for maintaining - Type "A" in Item Cat., go through
[Time related Rev. reco.|http://help.sap.com/erp2005_ehp_03/helpdata/EN/59/aff23cd85c11d199d60000e8a5bd28/frameset.htm]
Another Type is "B"
[Service related Rev. reco.|http://help.sap.com/erp2005_ehp_03/helpdata/EN/59/aff23fd85c11d199d60000e8a5bd28/frameset.htm]
Best Regards,
Amit
Note: There are few of my posts in threads
Re: Revenue recognition
Re: Revenue recognition design
this will provide some in-sights for rev. recog.

SAP Revenue recognition Credit Memo Accounting document

Hi,
One of our client uses SAP Revenue recognition to post revenue. They have implemented the Service related revenue recognition (revenue recognition category B) and also process credit/debit memo with reference to preceding docuemnt
"F". Each month a debit memo is issued ot the customer for the services performed. Eventually we create credit memos when the customer disputes a particular debit memo invoice. Debit memo and credit memo documents
are created with DP96.
The issue they have currently is with the credit memo account document postings. Client credit memo accounting documents are making postings to unbilled revenue accounts. The postings remain as debit postings in unbilled revenue accounts even after revenue is recognized for an order. According to them accounting rules do not fulfil with the credit memo postings to the unbilled revenue account. Hence we need your expert advice/opinoins.
Please reply as soon as possible because its very high priority issue.
Thanks & Regards
K.R.

Hi,
Please check the reason for value not flowing to the header data of the billing document.Once you get the value of the document tin the header , there will be no issue in creating an accounting document.
Check the item category of the credit memo.
Regards,
Phani Prasad

Regarding Revenue Recognition

Dear Friends,
I configured Revenue Recognition to my service client.In general process after saving the billing document we can see The bellow entries for accounting document.
Customer a/c Dt
Sales revenue a/c Cr
All taxes are Cr
But i want to know the accounting entries for the billing document which is created in Revenue Recognition.
Thank you,
Regards,
Ravi

which is created in Revenue Recognition
In order to see any details related to Revenue Recognition, have you executed VF44 ??
G. Lakshmipathi

Revenue Recognition in Russia

Hi,
we are rolling out our global SAP solution for Russia and I would like some valuable inputs from SAP Gurus to my query.
My query is regarding revenue recognition in Russia. According to local GAAP, unless a signed copy of the TORG-12 (Act of acceptance of the transfer of goods) is received from the customer, it cannot be considered as revenue for accounting purposes in Russia, whereas for US GAAP purposes revenue can be recognized once the goods have been delivered.
US GAAP is the leading ledger and Russian GAAP is the non leading ledger but it is not possible to release billing to accounting for the leading ledger only.
Another point to note is that Russian accounting is based on actuals and no accruals can be posted for revenues.
Pls. can someone provide me some insight as to how these two requirements were handled together in their projects within SAP.
We are on SAP ECC version 6 ehp4.
Thanks in advance for all your help.
Regards,
Nitin

Dear Deepu,
The Concept of "Revenue Recognition" in Item Category is -
The material, with specified Item Category, is defined for income-accrual or not.
Now, Income-accrual means, say, in a month, you have "n" no. of orders to deliver, but might possible that Invoice and Payment, may get done or may not be.
So, to realise such income for a particular period, we run revenue-recognition (VF44). In VKOA, we maintain "Provisional Account" for such income.
Once invoiced, Accrued income G/L gets debited and Customer G/L gets credited.
[Revenue Recognition|http://help.sap.com/erp2005_ehp_03/helpdata/EN/4d/fcd139f6e4cf2ce10000000a114084/frameset.htm]
As you asked for maintaining - Type "A" in Item Cat., go through
[Time related Rev. reco.|http://help.sap.com/erp2005_ehp_03/helpdata/EN/59/aff23cd85c11d199d60000e8a5bd28/frameset.htm]
Another Type is "B"
[Service related Rev. reco.|http://help.sap.com/erp2005_ehp_03/helpdata/EN/59/aff23fd85c11d199d60000e8a5bd28/frameset.htm]
Best Regards,
Amit
Note: There are few of my posts in threads
Re: Revenue recognition
Re: Revenue recognition design
this will provide some in-sights for rev. recog.

Blocking Periodic Revenue recognition without billing block

Hi All,
I am posting here first time and need some help with Periodic Revenue Recpgnition.
We have scenario where User wants to control the Revenue Recognition based on some contingency flag in Sales Order. If that flag is set then Periodic monthly Rev. Recog should not happen but when user unsets that flag in SO line item then Rev Recog should happen.
I know for Service Based Rev Recog there is a solution SAP provides as Customer Event Type by which we can achieve this without stopping invoicing.
But i am not sure how to block the Rev Recog to occur for Periodic Rev Recog as Customer Event type is not configurable in Item Category with Time-Related Rev Recog (A).
Please suggest some solution on how to achieve this goal with Periodic Rev Recog.
I will give full points for any good suggestion.
Thanks
Ravi

hi
check is there any user exit or BADI available.

SD Revenue Recognition Related Question

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